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Noncarbon Electricity Investment Strategy helps utilities hedge policy uncertainty, carbon tax risks, and emissions limits by scaling wind, solar, and CCS, avoiding stranded assets while balancing costs, reliability, and climate policy over decades.

Key Points

A strategy for utilities to invest 20-30 percent of capacity in low carbon sources to hedge emissions and carbon risks.

✅ Hedges future carbon tax and emissions limits

✅ Targets 20-30 percent of new generation from clean sources

✅ Reduces stranded asset risk and builds renewables capacity

When utility executives make decisions about building new power plants, a lot rides on their choices. Depending on their size and type, new generating facilities cost hundreds of millions or even billions of dollars. They typically will run for 40 or more years — 10 U.S. presidential terms. Much can change during that time.

Today one of the biggest dilemmas that regulators and electricity industry planners face is predicting how strict future limits on greenhouse gas emissions will be. Future policies will affect the profitability of today’s investments. For example, if the United States adopts a carbon tax 10 years from now, it could make power plants that burn fossil fuels less profitable, or even insolvent.

These investment choices also affect consumers. In South Carolina, utilities were allowed to charge their customers higher rates to cover construction costs for two new nuclear reactors, which have now been abandoned because of construction delays and weak electricity demand. Looking forward, if utilities are reliant on coal plants instead of solar and wind, it will be much harder and more expensive for them to meet future emissions targets, even as New Zealand's electrification push accelerates abroad. They will pass the costs of complying with these targets on to customers in the form of higher electricity prices.

With so much uncertainty about future policy, how much should we be investing in noncarbon electricity generation in the next decade? In a recent study, we proposed optimal near-term electricity investment strategies to hedge against risks and manage inherent uncertainties about the future.

We found that for a broad range of assumptions, 20 to 30 percent of new generation in the coming decade should be from noncarbon sources such as wind and solar energy across markets. For most U.S. electricity providers, this strategy would mean increasing their investments in noncarbon power sources, regardless of the current administration’s position on climate change.

Many noncarbon electricity sources — including wind, solar, nuclear power and coal or natural gas with carbon capture and storage — are more expensive than conventional coal and natural gas plants. Even wind power, which is often mentioned as competitive, is actually more costly when accounting for costs such as backup generation and energy storage to ensure that power is available when wind output is low.

Over the past decade, federal tax incentives and state policies designed to promote clean electricity sources spurred many utilities to invest in noncarbon sources. Now the Trump administration is shifting federal policy back toward promoting fossil fuels. But it can still make economic sense for power companies to invest in more expensive noncarbon technologies if we consider the potential impact of future policies.

How much should companies invest to hedge against the possibility of future greenhouse gas limits? On one hand, if they invest too much in noncarbon generation and the federal government adopts only weak climate policies throughout the investment period, utilities will overspend on expensive energy sources.

On the other hand, if they invest too little in noncarbon generation and future administrations adopt stringent emissions targets, utilities will have to replace high-carbon energy sources with cleaner substitutes, which could be extremely costly.

Economic modeling with uncertainty

We conducted a quantitative analysis to determine how to balance these two concerns and find an optimal investment strategy given uncertainty about future emissions limits. This is a core choice that power companies have to make when they decide what kinds of plants to build.

First we developed a computational model that represents the sectors of the U.S. economy, including electric power. Then we embedded it within a computer program that evaluates decisions in the electric power sector under policy uncertainty.

The model explores different electric power investment decisions under a wide range of future emissions limits with different probabilities of being implemented. For each decision/policy combination, it computes and compares economy-wide costs over two investment periods extending from 2015 to 2030.

We looked at costs across the economy because emissions policies impose costs on consumers and producers as well as power companies. For example, they may lead to higher electricity, fuel or product prices. By seeking to minimize economy-wide costs, our model identifies the investment decision that produces the greatest overall benefits to society.

More investments in clean generation make economic sense

We found that for a broad range of assumptions, the optimal investment strategy for the coming decade is for 20 to 30 percent of new generation to be from noncarbon sources. Our model identified this as the best level because it best positions the United States to meet a wide range of possible future policies at a low cost to the economy.

From 2005-2015, we calculated that about 19 percent of the new generation that came online was from noncarbon sources. Our findings indicate that power companies should put a larger share of their money into noncarbon investments in the coming decade.

While increasing noncarbon investments from a 19 percent share to a 20 to 30 percent share of new generation may seem like a modest change, it actually requires a considerable increase in noncarbon investment dollars. This is especially true since power companies will need to replace dozens of aging coal-fired power plants that are expected to be retired.

In general, society will bear greater costs if power companies underinvest in noncarbon technologies than if they overinvest. If utilities build too much noncarbon generation but end up not needing it to meet emissions limits, they can and will still use it fully. Sunshine and wind are free, so generators can produce electricity from these sources with low operating costs.

In contrast, if the United States adopts strict emissions limits within a decade or two, they could prevent carbon-intensive generation built today from being used. Those plants would become “stranded assets” — investments that are obsolete far earlier than expected, and are a drain on the economy.

Investing early in noncarbon technologies has another benefit: It helps develop the capacity and infrastructure needed to quickly expand noncarbon generation. This would allow energy companies to comply with future emissions policies at lower costs.

Seeing beyond one president

The Trump administration is working to roll back Obama-era climate policies such as the Clean Power Plan, and to implement policies that favor fossil generation. But these initiatives should alter the optimal strategy that we have proposed for power companies only if corporate leaders expect Trump’s policies to persist over the 40 years or more that these new generating plants can be expected to run.

Energy executives would need to be extremely confident that, despite investor pressure from shareholders, the United States will adopt only weak climate policies, or none at all, into future decades in order to see cutting investments in noncarbon generation as an optimal near-term strategy. Instead, they may well expect that the United States will eventually rejoin worldwide efforts to slow the pace of climate change and adopt strict emissions limits.

In that case, they should allocate their investments so that at least 20 to 30 percent of new generation over the next decade comes from noncarbon sources. Sustaining and increasing noncarbon investments in the coming decade is not just good for the environment — it’s also a smart business strategy that is good for the economy.

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Dragonfly energy sector cyberattacks target ICS and SCADA across critical infrastructure, including the power grid and nuclear facilities, using spearphishing, watering-hole sites, supply-chain compromises, malware, and VPN exploits to gain operational access.

Key Points

Dragonfly APT campaigns target energy firms and ICS to gain grid access, risking manipulation and service disruption.

✅ Breaches leveraged spearphishing, watering-hole sites, and supply chains.

✅ Targeted ICS, SCADA, VPNs to pivot into operational networks.

✅ Aimed to enable power grid manipulation and potential outages.

An October, 2017 report by researchers at Symantec Corp., cited by the U.S. government, has linked recent US power grid cyber attacks to a group of hackers it had code-named "Dragonfly", and said it found evidence critical infrastructure facilities in Turkey and Switzerland also had been breached.

The Symantec researchers said an earlier wave of attacks by the same group starting in 2011 was used to gather intelligence on companies and their operational systems. The hackers then used that information for a more advanced wave of attacks targeting industrial control systems that, if disabled, leave millions without power or water.

U.S. intelligence officials have long been concerned about the security of the country’s electrical grid. The recent attacks, condemned by the U.S. government, striking almost simultaneously at multiple locations, are testing the government’s ability to coordinate an effective response among several private utilities, state and local officials, and industry regulators.

#google#

While the core of a nuclear generator is heavily protected, a sudden shutdown of the turbine can trigger safety systems. These safety devices are designed to disperse excess heat while the nuclear reaction is halted, but the safety systems themselves may be vulnerable to attack.

The operating systems at nuclear plants also tend to be legacy controls built decades ago and don’t have digital control systems that can be exploited by hackers.

“Since at least March 2016, Russian government cyber actors… targeted government entities and multiple U.S. critical infrastructure sectors, including the energy, nuclear, commercial facilities, water, aviation, and critical manufacturing sectors,” according to Thursday’s FBI and Department of Homeland Security report. The report did not say how successful the attacks were or specify the targets, but said that the Russian hackers “targeted small commercial facilities’ networks where they staged malware, conducted spearphishing, and gained remote access into energy sector networks.” At least one target of a string of infrastructure attacks last year was a nuclear power facility in Kansas.

Symantec doesn’t typically point fingers at particular nations in its research on cyberattacks, said Eric Chien, technical director of Symantec’s Security Technology and Response division, though he said his team doesn’t see anything it would disagree with in the new federal report. The government report appears to corroborate Symantec’s research, showing that the hackers had penetrated computers and accessed utility control rooms that would let them directly manipulate power systems, he says.

“There were really no more technical hurdles for them to do something like flip off the power,” he said.

And as for the group behind the attacks, Chien said it appears to be relatively dormant for now, but it has gone quiet in the past only to return with new hacks.

“We expect they’re sort of retooling now, and they likely will be back,”

In some cases, Dragonfly successfully broke into the core systems that control US and European energy companies, Symantec revealed.

“The energy sector has become an area of increased interest to cyber-attackers over the past two years,” Symantec said in its report.

“Most notably, disruptions to Ukraine’s power system in 2015 and 2016 were attributed to a cyberattack and led to power outages affecting hundreds of thousands of people. In recent months, there have also been media reports of attempted attacks on the electricity grids in some European countries, as well as reports of companies that manage nuclear facilities in the US being compromised by hackers.

“The Dragonfly group appears to be interested in both learning how energy facilities operate and also gaining access to operational systems themselves, to the extent that the group now potentially has the ability to sabotage or gain control of these systems should it decide to do so. Symantec customers are protected against the activities of the Dragonfly group.”

In recent weeks, senior US intelligence officials said that the Kremlin believes it can launch hacking operations against the West with impunity, including a cyber weapon that can disrupt power grids, according to assessments.

The DHS and FBI report further elaborated: “This campaign comprises two distinct categories of victims: staging and intended targets. The initial victims are peripheral organisations such as trusted third-party suppliers with less-secure networks, referred to as ‘staging targets’ throughout this alert.

“The threat actors used the staging targets’ networks as pivot points and malware repositories when targeting their final intended victims. National Cybersecurity and Communications Integration Center and FBI judge the ultimate objective of the actors is to compromise organisational networks, also referred to as the ‘intended target’.”

According to the US alert, hackers used a variety of attack methods, including spear-phishing emails, watering-hole domains, credential gathering, open source and network reconnaissance, host-based exploitation, and deliberate targeting of ICS infrastructure.

The attackers also targeted VPN software and used password cracking tools.

Once inside, the attackers downloaded tools from a remote server and then carried out a number of actions, including modifying key systems to store plaintext credentials in memory, and built web shells to gain command and control of targeted systems.

“This actors’ campaign has affected multiple organisations in the energy, nuclear, water, aviation, construction and critical manufacturing sectors, with hundreds of victims across the U.S. power grid confirmed,” the DHS said, before outlining a number of steps that IT managers in infrastructure organisations can take to cleanse their systems and defend against Russian hackers. he said.
 

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CAISO Net Negative Emissions signal moments when greenhouse gas intensity of serving ISO demand drops below zero, driven by high renewable generation, low load, strong solar exports, and imports accounting in the California grid.

Key Points

Moments when CAISO's CO2 to serve demand is below zero, driven by renewables, exports, and import accounting.

✅ Calculated using imports and exports to serve ISO demand

✅ Occur during high solar output, low weekend load

✅ Coincide with curtailment and record renewable penetration

We’re a long way from the land of milk and honey, but on Easter Sunday – for about an hour – we got a taste.

On Sunday, at 1:55 PM Pacific Time the California Independent Systems Operator (CAISO) reported that greenhouse gas emissions necessary to serve its demand (~80% of California’s electricity demand on an annual basis), was measured at a rate -16 metric tons of CO2 per hour. Five minutes later, the value was -2 mTCO2/h, before it crept back up to 40 mTCO2/h at 2:05 PM PST. At 2:10 PST though it fell back to -86 mTCO2/h and stayed negative until 3:05 PM PST, even as global CO2 emissions flatlined in 2019 according to the IEA.

This information was brought to the attention of pv magazine via tweet from eagle eye Jon Pa after CAISO’s site first noted the negative values:

The region was still generating CO2 though, as natural gas, biogas, biomass, geothermal and even coal plants were running and pumping out emissions, even as potent greenhouse gases declined in the US under control efforts. CAISO’s Greenhouse Gas Emission Tracking Methodology, December 28, 2016 (pdf) notes the below calculations to create the value what it terms, “Total GHG emissions to serve ISO demand”:

Of importance to note is that to get to the net negative value, CAISO considered all electricity imports and exports, a reminder that climate policy shapes grid operations across North America. And as can be noted in the image below the CO2 intensity of imports during the day rapidly declined as the sun came up, first going negative around 9:05 AM PST, and mostly staying so until just before 6 PM PST.

During this same weekend, other records were noted (reiterating that we’re in record setting season and as the state pursues its 100% carbon-free mandate now in law) such as a new electricity export record of greater than 2 GW and total renewable electricity as part of total demand at greater than 70%.

At the peak negative moment of 2:15 PM PST, -112 mTCO2/h seen below, the total amount of clean instantaneous generation being used in the power grid region was 17 GW, a far cry from heat-driven reliability strains like rolling blackout warnings that arise during extreme demand, with renewables giving 76% of the total, hydro 14%, nuclear 13% and imports of -12% countering the CO2 coming from just over 1.4 GW of gas generation.

Also of importance are a few layers of nuance in the electricity demand charts. First off we’re in the shoulder seasons  of California – nice cool weather before the warmth of summer drives air conditioning demand. Additional the weekend electricity demand is always lower, as well, Easter Sunday might have had an affect, whereas in colder regions Calgary’s electricity use can soar during frigid snaps.

Lastly to note was the amount of electricity from solar and wind generation being curtailed. And while the Sunday numbers weren’t available yet, the below image noted Saturday with 10 GWh in total being curtailed (pdf) – peaking at over 3.2 GW of instantaneous mostly solar power even as solar is now the cheapest electricity according to the IEA, in the hours of 2 and 3 PM PST. On an annualized basis, less than 2% of total potential solar electricity was curtailed in 2018.

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Canada Clean Energy Transition accelerates via carbon pricing, renewables, EV incentives, energy efficiency upgrades, smart grids, interprovincial transmission, and innovation in hydro, wind, solar, and storage to cut emissions and power sustainable growth.

Key Points

Canada Clean Energy Transition is a shift to renewables, EVs and efficiency powered by smart policy and innovation.

✅ Carbon pricing and EV incentives accelerate adoption

✅ Grid upgrades, storage, and transmission expand renewables

✅ Industry efficiency and smart tech cut energy waste

So, how do we get there?

We're already on our way.

The final weeks of 2016 delivered some progress, as Prime Minister Justin Trudeau and premiers of 11 of the 13 provinces and territories negotiated a new national climate plan. The deal is a game changer. It marks the moment that Canada stopped arguing about whether to tackle climate change and started figuring out how we're going to get there.

We can each be part of the solution by reducing the amount of energy we use, making sure our homes and workplaces are well insulated and choosing energy efficient appliances. When the time comes to upgrade our cars, washing machines and refrigerators, we can take advantage of rebates that cut the cost of electric models. In our homes, we can install smart technology — like automated thermostats — to cut down on energy waste and reduce power bills.

Even industries that use a lot of energy, like mining and manufacturing, could become leaders in sustainability. It would mean investing in energy saving technology, making their operations more efficient and running conveyor belts, robots and other equipment off locally produced renewable electricity.

Meanwhile, laboratories and factories in Ontario, Quebec and British Columbia are making breakthroughs in areas like energy storage, while renewable energy growth in the Prairie Provinces gathers momentum, which will make it possible to access clean power even when the sun isn't shining and the wind isn't blowing.

Liberal leader Justin Trudeau holds a copy of his environmental platform after announcing details of it at Jericho Beach Park in Vancouver, B.C., on Monday June 29, 2015. (Darryl Dyck/Canadian Press)

The scale and speed of Canada's transition to clean energy depends on provincial and federal policies that do things like tax carbon pollution, build interprovincial electricity transmission lines, invest in renewable energy and grid modernization projects that strengthen the system, and increase incentives for electric vehicles. 

Of course, even the best policies won't produce lasting results unless Canadians fight for them and take ownership for our role in the energy transition. Global momentum toward clean energy may be "irreversible," as former U.S. President Barack Obama recently wrote in the journal Science — but it's up to us whether Canada catches that wave or misses out.

Fortunately, clean energy has always been part of Canada's DNA.

We can learn from the past

In remote corners of the newly minted Dominion of Canada, rushing rivers turned the waterwheels that powered the lumber mills that built the places we inhabit today. The first electric lights were switched on in Winnipeg shortly after Confederation. By the turn of the 20th century, hydro power was lighting up towns and cities from coast to coast.  

Our country is home to some of the world's best clean energy resources, and experts note that zero-emissions electricity by 2035 is possible given our strengths, and fully two-thirds of our power is generated from renewable sources like hydro, wind and solar.

Looking to our heritage, we can make clean growth the next chapter in Canada's history

Recent commitments to phase out coal and invest in clean energy infrastructure mean the share of renewable power in Canada's energy mix is poised to grow. The global shift from fossil fuels to clean energy is opening up huge opportunities and Canada's opportunity in the global electricity market is growing as the country has the expertise to deliver solutions around the world.

Looking to our heritage, we can make clean growth the next chapter in Canada's history — building a nation that's electric, connected and on a practical, profitable path to 2035 zero-emission power for households and industry, stronger than ever.

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Maryland Community Solar Program enables renters and condo residents to subscribe to offsite solar, earn utility bill discounts, and support projects across BGE, Pepco, Delmarva, and Potomac Edison territories, with low to moderate income participation.

Key Points

A pilot allowing residents to subscribe to offsite solar and get bill credits and savings, regardless of home ownership.

✅ 5-10 percent discounts on standard utility rates

✅ Available in BGE, Pepco, Delmarva, Potomac Edison areas

✅ Includes low and moderate income subscriber carve-outs

Maryland has launched a pilot program that will allow anyone to power their home with solar panels — even if they are renters or condo-dwellers, or live in the shade of trees.

Solar developers are looking for hundreds of residents to subscribe to six power projects planned across the state, including recently announced sites in Owings Mills and Westminster. Their offers include discounts on standard electric rates.

The developers need a critical mass of customers who are willing to buy the projects’ electricity before they can move forward with plans to install solar panels on about 80 acres. Under state rules, the customer base must include low- and moderate-income residents, many of whom face energy insecurity challenges.

The idea of the community solar program is to tap into the pool of residential customers who don’t want to get their energy from fossil fuels but currently have no way to switch to a cleaner alternative.

That could significantly expand demand for solar projects, said Gary Skulnik, a longtime Maryland solar entrepreneur.

Skulnik is now CEO of Neighborhood Sun, a company recruiting customers for the six projects.

“You’re signing up for a project that won’t exist unless we get enough subscribers,” Skulnik said. “You’re actually getting a new project built.”

It could also stoke simmering conflicts over what sort of land is appropriate for solar development.

The General Assembly authorized the community solar pilot program in 2015. But not-in-my-backyard opposition and concerns about the loss of agricultural land have slowed progress.

Community solar could force more communities to confront those sorts of clashes — and to consider more carefully where solar farms belong.

“We are going to see a lot more solar development in the state,” said Megan Billingsley, assistant director of the Valleys Planning Council in Baltimore County. “One of the things we haven’t seen is any direction or thoughtful planning on where we want to see solar development.”

The General Assembly authorized about 200 megawatts in community solar projects — enough to power about 40,000 households — over three years.

Customers can sign up for projects built within the territory of their electric utility. About half of that solar energy load has been allotted for the region served by Baltimore Gas and Electric Co.

By subscribing to a community solar project, customers won’t actually be getting their electricity from its photovoltaic panels. But their payments will help finance it and, in some cases, complementary battery storage solutions as well.

The Public Service Commission has approved six projects so far: Two in BGE territory, in Owings Mills and near Westminster; one in Pepco territory, in Prince George’s County; two in Delmarva Power and Light territory, in Caroline and Worcester counties; and one in Potomac Edison territory, in Washington County where planning officials have developed proposed recommendations.

More projects are expected to win approval in the next two years.

But none of them can be built unless they catch on with electricity customers. The developers are looking for 2,600 customers statewide.

Skulnik would not say how many customers an individual project needs to get the green light. But he said that the Prince George’s proposal, a 25-acre array atop a Fort Washington landfill is the closest, with about 100 subscribers so far.

The terms of subscription vary by project, but discounts range from 5 percent to 10 percent off utility rates. Customers are asked to commit to the projects for as long as 25 years. (They can break the contracts with advance notice, or if they move to a different utility service area.)

Maryland joins more than a dozen states in advancing community solar projects, as scientists work to improve solar and wind power technology.

Corey Ramsden is an executive for Solar United Neighbors, a nonprofit that promotes the solar industry in eight states and the District of Columbia.

He said potential customers are often confused by the mechanics of subscribing to community solar, or hesitant to commit for years or even decades. The industry is working to answer questions and get people more comfortable with the idea, he said.

But it has been a challenge across the country, including debates over New England grid upgrades, and in Maryland. Advocates for solar say there is broad support for renewable energy generation. The state has set goals to increase green energy use and reduce greenhouse gas emissions.

Still, many Marylanders don’t welcome the reality when a project attempts to move in.

Rural land is often the most desirable for solar developers, because it requires the least effort to prepare for an array of panels. But community groups in those areas have asked whether land historically used for farming is right for a more industrial use.

“People are very much in favor of going for a lot more renewables, for whatever reason,” said Dru Schmidt-Perkins, the former president of the land conservation group 1,000 Friends of Maryland. “That support comes to a screeching halt when land that is perceived to be valuable for other things, whether a historic view­shed or farming, suddenly becomes a target of a location for this new project.”

Such concerns have at least temporarily stalled the momentum for solar across the state. Anne Arundel County had at least five small community solar projects in the pipeline in December when officials decided to pause development for eight months. Baltimore County officials imposed a four-month moratorium on solar development before passing an ordinance last year to limit the size and number of solar farms.

Billingsley said the Valley Plannings Council, which advocates for historic and rural areas in western Baltimore County, is frustrated that there hasn’t been more discussion about which areas the county should target for solar development — and which it shouldn’t.

She said she fears that pressure to expand solar farms across rural lands is only going to grow as community solar projects launch, and as lawmakers in Annapolis talk about more policies to promote investment in renewable energy.

Schmidt-Perkins called community solar “an amazing program” for those who would install solar panels on their roofs if they could. But she said its launch heightens the importance of discussions about a broader solar strategy.

“Most communities are caught a little flat-footed on this and are somewhat at the mercy of an industry that’s chomping at the bit,” she said. “It’s time for Maryland to say, ‘Okay, let’s come up with our plan so that we know how much solar can we really generate in this state on lands that are not conflict-based.’”

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US Electricity Sales Decline amid population growth and GDP gains, as DOE links reduced per capita consumption to energy efficiency, warmer winters, appliances, and bulbs, while hotter summers and rising AC demand may offset savings.

Key Points

US electricity sales fell 3% since 2010 despite population and GDP growth, driven by efficiency gains and warmer winters.

✅ DOE links drops to efficiency and warmer winters

✅ Per capita residential use fell about 7% since 2010

✅ Rising AC demand may offset winter heating savings

Since 2010, the United States has grown by 17 million people, and the gross domestic product (GDP) has increased by $3.6 trillion. Yet in that same time span, electricity sales in the United States actually declined by 3%, according to data released by the U.S. Department of Energy (DOE), even as electricity prices rose at a 41-year pace nationwide.

The U.S. decline in electricity sales is remarkable given that the U.S. population increased by 5.8% in that same time span. This means that per capita electricity use fell even more than that; indeed, the Department of Energy pegs residential electricity sales per capita as having declined by 7%, even as inflation-adjusted residential bills rose 5% in 2022 nationwide.

There are likely multiple reasons for this decline in electricity sales. Department of Energy analysts suggest that, at least in part, it is due to increased adoption of energy-efficient appliances and bulbs, like compact fluorescents. Indeed, the DOE notes that there is a correlation between consumer spending on “energy efficiency” and a reduction in per capita electricity sales, while utilities invest more in delivery infrastructure to modernize the grid.

Yet the DOE also notes that states with a greater increase in warm weather days had a corresponding decrease in electricity sales, as milder weather can reduce power demand across years. In southern states, the effect was most dramatic: for instance, from 2010 to 2016, Florida had a 56% decrease in cold weather days that would require heating and as a result, saw a 9% decrease in per capita electricity sales.

The moral is that warm winters save on electricity. But if global temperatures continue to rise, and summers become hotter, too, this decrease in winter heating spending may be offset by the increased need to run air conditioning in the summer, and given how electricity and natural gas prices interact, overall energy costs could shift. Indeed, it takes far more energy to cool a room than it does to heat it, for reasons related to the basic laws of thermodynamics. 

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